Bailey to replace Ahrendts as Burberry CEO - UPDATE

15th Oct 2013 07:15

Angela Ahrendts, Burberry's Chief Executive Officer (CEO) since 2006, is joining US tech giant Apple next year, leaving Chief Creative Officer (CCO) Christopher Bailey in charge.The news came as the company reported 14% growth in underlying sales in the first half, helped by strong demand from Chinese customers, and raised its profit guidance for the period.Bailey, who has been with the high-end luxury brand since 2001, is widely seen as one of the most influential people in the fashion industry, overseeing product design and development, marketing, store design and digital innovation during the past six years in his role as CCO. In a statement on Tuesday, Bailey said he was "profoundly moved and humbled" to take on the role of CEO "at this company that means so much to me"."I also feel privileged to be keeping my role as Chief Creative Officer, as I believe that creativity and innovation have been at the heart of our success in the last 10 years and will be even more so in the decade ahead," he said.Ahrendts, who earlier this year became the first woman to top the list of the highest paid CEO on the FTSE 100, will leave the company in mid-2014 and move to Apple to head up the direction, expansion and operation of its retail and online operations, reporting to CEO Tim Cook.She said: "Burberry is in brilliant shape, having built the industry's most powerful management team, converted the business to a dynamic digital global retailer, created a world class supply chain, state of the art technology infrastructure, sensational brand momentum and one of the most closely connected creative cultures in the world today."Chinese demand helps Retail salesGroup revenue totalled £1,031m in the six months to September 30th, up 14% on an underlying basis year-on-year. This was helped by 17% underlying growth in Retail to £694m, offsetting a 7% fall (albeit better than previously expected) in Wholesale to £244m.Burberry achieved 13% comparable store sales growth in Retail during the first half, boosted by double-digit growth Asia Pacific and Europe, Middle East, India and Africa (EMEIA), as well as high single-digit growth in the Americas. It said that growth across the rest of Asia accelerated during the period and flagship markets in Europe saw a higher proportion of tourist transactions, reflecting more travelling luxury customers from China.Burberry said that adjusted profit before tax for the first half is now expected to be flat on the prior year at £173m, better than previous guidance for a decline.However, the company warned: "The recent appreciation of sterling, if it persists, will impact the translation of second-half revenue and profit."BC